Move To Make 1MDB Advisor Bank Negara's New Governor Was Objected By Zeti, WSJ Says

The current central-bank governor, Tan Sri Zeti Akhtar Aziz, is retiring next month after 16 years in the post.

Cover image via SAYS

Tan Sri Irwan Serigar Abdullah is expected to succeed Tan Sri Zeti Akhtar Aziz as Bank Negara Malaysia (BNM) governor, the Wall Street Journal (WSJ) reported today

Tan Sri Irwan Serigar Abdullah.

Image via The Malaysian Insider

A top government official on the board of advisors of a controversial state investment fund is set to become the new head of the central bank, which had recommended investigating the fund, two people familiar with the matter said.

The current central-bank governor, Zeti Akhtar Aziz, is retiring next month after 16 years in the post, and she recommended a deputy governor to succeed her, one of the people said.

The finance ministry’s top bureaucrat, Irwan Serigar Abdullah, is expected to be named as the new central-bank head by the government in the coming week, a cabinet minister and a senior commercial banker said Friday, 11 March.

WSJ also reported that the move comes over the objection of Tan Sri Zeti.

Tan Sri Irwan is a member of 1MDB's board of advisors and Secretary-General of Treasury at the Finance Ministry.

Tan Sri Irwan Serigar Abdullah is a member of the board of advisors for 1MDB.

Image via 1MDB

Mohd Irwan was one of the candidates short-listed for the job along with deputy central bank governor Muhammad Ibrahim, the minister in the Prime Minister's Department in charge of Economic Planning Abdul Wahid Omar and the ambassador to the United States Awang Adek Hussin, Reuters reported in February.

A career civil servant, Mohd Irwan is Treasury secretary-general at the Finance Ministry, which is headed by Prime Minister Najib.

He is also a member of the board of advisors for 1MDB.

Meanwhile, Tan Sri Zeti said to patiently await for the government's decision that will soon be announced

Tan Sri Zeti Akhtar Aziz.

Image via Dimas Ardian/Bloomberg

"We have made the recommendation and the government will make the decision and submit the name to the Agong," Zeti told reporters on the sidelines of the Wharton Global Forum 2016 in Kuala Lumpur.

"Just be patient. (It will be announced) very soon," she said when asked who would be her preferred choice between Datuk Seri Abdul Wahid Omar, Minister in the Prime Minister's Department, and Datuk Mohamed Ibrahim, the current deputy governor.

Besides the two, the list of potential candidates includes Malaysian Ambassador to the US Datuk Dr Awang Adek Hussin, Treasury secretary-general Tan Sri Mohd Irwan Serigar Abdullah and deputy Bank Negara governor Datuk Nor Shamsiah Mohd Yunus.

Zeti has been the head of Malaysia's central bank for the past 16 years. This year marks her 35th year of service with BNM.

As the first woman Governor of Malaysia's Central Bank, Zeti is widely respected, and credited for pushing reforms and sound policies, as well as protecting the independence of the central bank, Reuters wrote.

WSJ also sang praises for Zeti, saying that her stable economic management has successfully attracted investment in the nation’s stock and bond markets.

Last year, rumours arose that Zeti was under pressure to resign due to BNM's part in the special task force investigating the alleged RM2.6 billion money trail linked to 1MDB and PM Najib

Investigators in at least five countries, including the U.S., are probing allegations that billions of dollars in money from the state fund, 1Malaysia Development Bhd., or 1MDB, has gone missing. The fund is wholly owned by the finance ministry, led by Prime Minister Najib Razak.

The central bank recommended that the attorney general’s office file criminal charges against 1MDB for allegedly giving inaccurate information regarding the investment of USD1.83 billion outside the country from 2009 to 2011.

The attorney general declined, saying Bank Negara had supplied insufficient evidence.

However, Zeti dismissed all speculations about her resignation last August, and said that she intends to see out her 5-year term, which ends in April 2016:

Two weeks ago, WSJ claimed that deposits in the personal accounts of PM Najib Razak actually totalled more than USD1 billion:

Need a refresher on the 1MDB controversy? Here's all you need to know about the scandal, in short, easy-to-watch videos:

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